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The euro and inflation in Croatia: much ado about nothing?
Petar Sorić* 
Article | Year: 2024 | Pages: 1 - 37 | Volume: 48 | Issue: 1 Received: June 1, 2023 | Accepted: October 25, 2023 | Published online: March 1, 2024
|
FULL ARTICLE
FIGURES & DATA
REFERENCES
CROSSMARK POLICY
METRICS
LICENCING
PDF
Note: Vertical dotted line corresponds to September 2022 (start of obligatory dual display of
prices). Vertical full line corresponds to January 2023 (euro changeover). Inflation expectations
are quantified as the response balance to question 6 from the EU Consumer Survey (see section
3 for details). Source: Eurostat and European Commission.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
hicp
|
1.704
|
0.974
|
1.589
|
0.508
|
1.199
|
2.062
|
2.038
|
|
(0.038)
|
(0.291)
|
(0.155)
|
(0.601)
|
(0.235)
|
(0.038)
|
(0.014)
|
|
food
|
0.065
|
0.203
|
0.823
|
2.748
|
3.927
|
4.889
|
3.615
|
|
(0.986)
|
(0.934)
|
(0.648)
|
(0.127)
|
(0.019)
|
(0.005)
|
(0.028)
|
|
nonalc
|
0.202
|
-1.845
|
-1.570
|
-0.002
|
1.971
|
3.038
|
2.653
|
|
(0.864)
|
(0.315)
|
(0.390)
|
(0.977)
|
(0.296)
|
(0.089)
|
(0.113)
|
|
alc
|
1.077
|
-0.522
|
-2.041
|
-1.794
|
-1.449
|
-1.294
|
-1.374
|
|
(0.577)
|
(0.826)
|
(0.282)
|
(0.343)
|
(0.498)
|
(0.545)
|
(0.516)
|
|
clothing
|
8.225
|
5.901
|
3.294
|
3.419
|
2.121
|
4.385
|
7.374
|
|
(0.005)
|
(0.014)
|
(0.202)
|
(0.174)
|
(0.441)
|
(0.094)
|
(0.005)
|
|
housing
|
4.362
|
3.626
|
0.800
|
-1.105
|
-1.182
|
-0.703
|
-0.086
|
|
(0.244)
|
(0.371)
|
(0.930)
|
(0.718)
|
(0.681)
|
(0.812)
|
(0.953)
|
|
furnish
|
1.463
|
1.014
|
0.181
|
-1.211
|
0.699
|
1.165
|
2.154
|
|
(0.061)
|
(0.197)
|
(0.817)
|
(0.117)
|
(0.380)
|
(0.131)
|
(0.019)
|
|
health
|
2.386
|
1.795
|
1.539
|
1.782
|
2.831
|
4.098
|
4.364
|
|
(0.188)
|
(0.324)
|
(0.385)
|
(0.366)
|
(0.169)
|
(0.023)
|
(0.019)
|
|
transport
|
-0.835
|
-0.373
|
-0.761
|
-1.722
|
-1.421
|
0.198
|
1.109
|
|
(0.577)
|
(0.751)
|
(0.592)
|
(0.300)
|
(0.352)
|
(0.901)
|
(0.479)
|
|
commun
|
-1.623
|
-1.662
|
-1.034
|
-0.097
|
0.167
|
-0.979
|
1.647
|
|
0.277)
|
(0.277)
|
(0.521)
|
(0.962)
|
(0.911)
|
(0.540)
|
(0.291)
|
|
recr
|
-0.802
|
-2.032
|
-3.410
|
-3.965
|
-4.310
|
-3.545
|
-0.533
|
|
(0.549)
|
(0.188)
|
(0.056)
|
(0.033)
|
(0.023)
|
(0.075)
|
(0.789)
|
|
educ
|
1.970
|
1.718
|
2.299
|
2.465
|
2.084
|
2.683
|
3.560
|
|
(0.235)
|
(0.277)
|
(0.192)
|
(0.178)
|
(0.239)
|
(0.174)
|
(0.061)
|
|
rest
|
4.340
|
3.701
|
4.391
|
5.276
|
6.890
|
9.087
|
7.024
|
|
(0.028)
|
(0.052)
|
(0.038)
|
(0.038)
|
(0.014)
|
(0.005)
|
(0.009)
|
|
misc
|
1.501
|
-0.049)
|
0.269
|
0.298
|
1.219
|
0.915
|
0.930
|
|
(0.103)
|
(0.930)
|
(0.756)
|
(0.732)
|
(0.188)
|
(0.371)
|
(0.366)
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. Source: Author’s calculation.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
hicp
|
0.862
|
0.220
|
-0.439
|
-1.225
|
-0.348
|
0.700
|
0.905
|
|
(0.315)
|
(0.817)
|
(0.704)
|
(0.225)
|
(0.761)
|
(0.460)
|
(0.282)
|
|
food
|
-1.402
|
-0.719
|
0.210
|
2.590
|
4.231
|
4.850
|
3.442
|
|
(0.451)
|
(0.718)
|
(0.930)
|
(0.117)
|
(0.019)
|
(0.005)
|
(0.056)
|
|
nonalc
|
-0.612
|
-2.586
|
-2.417
|
-0.793
|
0.886
|
2.662
|
2.688
|
|
(0.657)
|
(0.136)
|
(0.164)
|
(0.568)
|
(0.549)
|
(0.113)
|
(0.108)
|
|
alc
|
0.795
|
-0.825
|
-2.113
|
-2.496
|
-1.738
|
-1.836
|
-1.922
|
|
(0.695)
|
(0.690)
|
(0.258)
|
(0.216)
|
(0.404)
|
(0.343)
|
(0.315)
|
|
clothing*
|
8.225
|
5.901
|
3.294
|
3.419
|
2.121
|
4.385
|
7.374
|
|
(0.005)
|
(0.014)
|
(0.202)
|
(0.174)
|
(0.441)
|
(0.094)
|
(0.005)
|
|
housing
|
1.024
|
-0.102
|
-1.555
|
-4.839
|
-5.390
|
-4.619
|
-3.682
|
|
(0.878)
|
(0.911)
|
(0.648)
|
(0.225)
|
(0.207)
|
(0.225)
|
(0.286)
|
|
furn*
|
1.463
|
1.014
|
0.181
|
-1.211
|
0.699
|
1.165
|
2.154
|
|
(0.061)
|
(0.197)
|
(0.817)
|
(0.117)
|
(0.380)
|
(0.131)
|
(0.019)
|
|
health
|
2.561
|
2.029
|
1.754
|
1.802
|
3.153
|
5.098
|
5.287
|
|
(0.178)
|
(0.272)
|
(0.315)
|
(0.347)
|
(0.136)
|
(0.019)
|
(0.019)
|
|
transport
|
0.143
|
1.034
|
1.717
|
0.866
|
-0.112
|
1.376
|
2.172
|
|
(0.958)
|
(0.568)
|
(0.333)
|
(0.554)
|
(0.948)
|
(0.352)
|
(0.160)
|
|
commun
|
-2.028
|
-2.431
|
-2.058
|
-0.566
|
-0.586
|
-1.993
|
0.860
|
|
(0.239)
|
(0.169)
|
(0.258)
|
(0.700)
|
(0.695)
|
(0.263)
|
(0.592)
|
|
recr*
|
-0.802
|
-2.032
|
-3.410
|
-3.965
|
-4.310
|
-3.545
|
-0.533
|
|
(0.549)
|
(0.188)
|
(0.056)
|
(0.033)
|
(0.023)
|
(0.075)
|
(0.789)
|
|
educ
|
1.564
|
1.156
|
1.313
|
1.476
|
1.178
|
1.577
|
2.260
|
|
(0.319)
|
(0.451)
|
(0.390)
|
(0.366)
|
(0.446)
|
(0.324)
|
(0.188)
|
|
rest
|
4.222
|
3.531
|
4.176
|
5.265
|
6.417
|
8.837
|
6.821
|
|
(0.028)
|
(0.052)
|
(0.042)
|
(0.042)
|
(0.009)
|
(0.005)
|
(0.009)
|
|
misc
|
1.808
|
0.682
|
0.737
|
0.985
|
1.521
|
0.618
|
0.770
|
|
(0.099)
|
(0.455)
|
(0.418)
|
(0.300)
|
(0.127)
|
(0.488)
|
(0.413)
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. * Denotes specifications with no MSPEs three times larger than the Croatian one (leaving the baseline ASCM results intact). Source: Author’s calculation.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
hicp
|
2.678
|
1.626
|
2.478
|
0.853
|
0.506
|
1.174
|
1.298
|
|
(0.355)
|
(0.595)
|
(0.397)
|
(0.769)
|
(0.81)
|
(0.636)
|
(0.554)
|
|
food
|
4.521
|
3.286
|
2.543
|
3.220
|
3.441
|
4.811
|
3.721
|
|
(0.157)
|
(0.306)
|
(0.372)
|
(0.215)
|
(0.149)
|
(0.025)
|
(0.074)
|
|
nonalc
|
1.124
|
-3.245
|
-3.583
|
-3.264
|
-2.031
|
0.215
|
-1.607
|
|
(0.736)
|
(0.339)
|
(0.413)
|
(0.463)
|
(0.62)
|
(0.95)
|
(0.463)
|
|
alc
|
2.783
|
1.040
|
-0.778
|
-0.455
|
-0.454
|
0.287
|
0.141
|
|
(0.215)
|
(0.579)
|
(0.678)
|
(0.851)
|
(0.843)
|
(0.959)
|
(0.992)
|
|
clothing
|
8.871
|
6.440
|
2.785
|
3.413
|
1.813
|
4.148
|
7.803
|
|
(0.008)
|
(0.033)
|
(0.421)
|
(0.174)
|
(0.636)
|
(0.083)
|
(0.008)
|
|
housing
|
-22.051
|
-16.597
|
-12.641
|
-27.614
|
-29.643
|
-20.988
|
-15.951
|
|
(0.612)
|
(0.562)
|
(0.653)
|
(0.388)
|
(0.372)
|
(0.397)
|
(0.512)
|
|
furn
|
6.726
|
5.535
|
4.894
|
3.677
|
3.762
|
3.114
|
3.022
|
|
(0.008)
|
(0.008)
|
(0.008)
|
(0.008)
|
(0.008)
|
(0.008)
|
(0.008)
|
|
health
|
-4.891
|
-5.445
|
-4.343
|
-5.334
|
-3.745
|
-1.526
|
-2.173
|
|
(0.099)
|
(0.066)
|
(0.165)
|
(0.215)
|
(0.355)
|
(0.711)
|
(0.57)
|
|
transport
|
-0.613
|
-0.533
|
-0.916
|
-0.845
|
-1.627
|
-0.587
|
0.558
|
|
(0.727)
|
(0.744)
|
(0.694)
|
(0.645)
|
(0.463)
|
(0.744)
|
(0.835)
|
|
commun
|
-0.076
|
-0.094
|
0.471
|
1.884
|
1.886
|
-0.362
|
3.159
|
|
(0.975)
|
(0.975)
|
(0.818)
|
(0.405)
|
(0.397)
|
(0.851)
|
(0.207)
|
|
recr
|
-6.616
|
-7.152
|
-8.661
|
-9.315
|
-8.989
|
-5.424
|
2.099
|
|
(0.231)
|
(0.165)
|
(0.14)
|
(0.058)
|
(0.033)
|
(0.149)
|
(0.545)
|
|
educ
|
13.190
|
13.044
|
13.313
|
12.737
|
12.811
|
13.079
|
13.782
|
|
(0.223)
|
(0.231)
|
(0.223)
|
(0.24)
|
(0.248)
|
(0.231)
|
(0.223)
|
|
rest
|
12.742
|
12.243
|
13.025
|
11.675
|
11.423
|
12.661
|
9.611
|
|
(0.033)
|
(0.033)
|
(0.033)
|
(0.033)
|
(0.025)
|
(0.017)
|
(0.025)
|
|
misc
|
3.894
|
2.993
|
2.967
|
2.476
|
2.331
|
1.888
|
1.904
|
|
(0.017)
|
(0.05)
|
(0.025)
|
(0.05)
|
(0.074)
|
(0.091)
|
(0.099)
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. Source: Author’s calculation.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
hicp
|
3.285
|
2.245
|
2.821
|
1.683
|
2.210
|
3.117
|
2.998
|
|
(0.005)
|
(0.038)
|
(0.043)
|
(0.215)
|
(0.048)
|
(0.01)
|
(0.005)
|
|
food
|
1.832
|
1.994
|
2.338
|
4.398
|
4.890
|
5.469
|
3.203
|
|
(0.378)
|
(0.359)
|
(0.282)
|
(0.033)
|
(0.01)
|
(0.005)
|
(0.067)
|
|
nonalc
|
2.052
|
-0.339
|
0.642
|
2.290
|
3.811
|
4.546
|
3.525
|
|
(0.297)
|
(0.809)
|
(0.727)
|
(0.301)
|
(0.062)
|
(0.014)
|
(0.053)
|
|
alc
|
0.946
|
-0.674
|
-2.200
|
-1.948
|
-1.599
|
-1.388
|
-1.437
|
|
(0.627)
|
(0.756)
|
(0.278)
|
(0.321)
|
(0.459)
|
(0.536)
|
(0.512)
|
|
clothing
|
7.889
|
5.817
|
3.118
|
3.143
|
2.098
|
3.728
|
7.265
|
|
(0.005)
|
(0.019)
|
(0.187)
|
(0.158)
|
(0.373)
|
(0.091)
|
(0.005)
|
|
housing
|
5.608
|
4.200
|
1.014
|
-2.075
|
-2.172
|
-1.993
|
-0.969
|
|
(0.474)
|
(0.565)
|
(0.938)
|
(0.689)
|
(0.651)
|
(0.641)
|
(0.77)
|
|
furn
|
2.542
|
1.932
|
1.136
|
-0.299
|
1.425
|
1.600
|
2.469
|
|
(0.01)
|
(0.033)
|
(0.196)
|
(0.684)
|
(0.1)
|
(0.043)
|
(0.005)
|
|
health
|
2.516
|
1.926
|
1.670
|
1.929
|
2.990
|
4.239
|
4.506
|
|
(0.182)
|
(0.301)
|
(0.388)
|
(0.349)
|
(0.172)
|
(0.024)
|
(0.019)
|
|
transport
|
-0.216
|
-0.013
|
-0.837
|
-1.878
|
-1.846
|
-0.042
|
0.702
|
|
(0.809)
|
(0.952)
|
(0.574)
|
(0.244)
|
(0.263)
|
(0.947)
|
(0.651)
|
|
commun
|
-1.781
|
-1.922
|
-0.374
|
0.529
|
0.879
|
-0.322
|
2.579
|
|
(0.254)
|
(0.23)
|
(0.852)
|
(0.742)
|
(0.569)
|
(0.861)
|
(0.124)
|
|
recr
|
-1.670
|
-2.882
|
-4.296
|
-4.707
|
-4.951
|
-4.009
|
-0.692
|
|
(0.378)
|
(0.163)
|
(0.053)
|
(0.033)
|
(0.024)
|
(0.067)
|
(0.77)
|
|
educ
|
1.971
|
1.721
|
2.179
|
2.330
|
1.919
|
2.477
|
3.333
|
|
(0.603)
|
(0.636)
|
(0.569)
|
(0.541)
|
(0.612)
|
(0.522)
|
(0.397)
|
|
rest
|
7.230
|
6.572
|
7.063
|
7.692
|
9.500
|
11.415
|
9.530
|
|
(0.01)
|
(0.01)
|
(0.01)
|
(0.014)
|
(0.01)
|
(0.005)
|
(0.01)
|
|
misc
|
3.126
|
1.891
|
1.727
|
1.115
|
1.649
|
1.383
|
1.158
|
|
(0.01)
|
(0.11)
|
(0.11)
|
(0.268)
|
(0.1)
|
(0.201)
|
(0.273)
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. Source: Author’s calculation.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
hicp
|
1.988
|
1.196
|
1.884
|
0.768
|
1.429
|
2.275
|
2.234
|
|
(0.024)
|
(0.212)
|
(0.108)
|
(0.472)
|
(0.189)
|
(0.028)
|
(0.005)
|
|
food
|
0.280
|
0.353
|
1.023
|
2.935
|
4.014
|
4.961
|
3.604
|
|
(0.901)
|
(0.882)
|
(0.559)
|
(0.113)
|
(0.024)
|
(0.005)
|
(0.028)
|
|
nonalc
|
-0.018
|
-2.062
|
-1.764
|
-0.213
|
1.533
|
2.949
|
2.625
|
|
(0.981)
|
(0.255)
|
(0.354)
|
(0.896)
|
(0.382)
|
(0.108)
|
(0.132)
|
|
alc
|
1.103
|
-0.491
|
-2.010
|
-1.754
|
-1.148
|
-1.276
|
-1.362
|
|
(0.571)
|
(0.844)
|
(0.288)
|
(0.368)
|
(0.509)
|
(0.552)
|
(0.524)
|
|
clothing
|
8.193
|
6.030
|
3.455
|
3.351
|
2.372
|
4.265
|
7.397
|
|
(0.005)
|
(0.009)
|
(0.16)
|
(0.156)
|
(0.349)
|
(0.08)
|
(0.005)
|
|
housing
|
4.264
|
3.606
|
0.971
|
-1.116
|
-1.014
|
-0.719
|
-0.274
|
|
(0.335)
|
(0.462)
|
(0.939)
|
(0.741)
|
(0.741)
|
(0.802)
|
(0.915)
|
|
furn
|
1.755
|
1.190
|
0.488
|
-0.790
|
0.936
|
1.357
|
2.262
|
|
(0.028)
|
(0.156)
|
(0.491)
|
(0.349)
|
(0.264)
|
(0.118)
|
(0.009)
|
|
health
|
2.431
|
1.840
|
1.588
|
1.836
|
2.889
|
4.155
|
4.422
|
|
(0.184)
|
(0.311)
|
(0.382)
|
(0.358)
|
(0.17)
|
(0.024)
|
(0.019)
|
|
transport
|
-0.822
|
-0.596
|
-1.142
|
-2.081
|
-1.851
|
-0.048
|
0.814
|
|
(0.566)
|
(0.632)
|
(0.472)
|
(0.217)
|
(0.259)
|
(0.892)
|
(0.608)
|
|
commun
|
-1.749
|
-1.682
|
-0.932
|
-0.004
|
0.254
|
-0.966
|
1.789
|
|
(0.269)
|
(0.311)
|
(0.604)
|
(1.000)
|
(0.868)
|
(0.594)
|
(0.269)
|
|
recr
|
-0.868
|
-2.090
|
-3.474
|
-4.006
|
-4.354
|
-3.561
|
-0.498
|
|
(0.528)
|
(0.203)
|
(0.057)
|
(0.033)
|
(0.024)
|
(0.075)
|
(0.811)
|
|
educ
|
1.980
|
1.726
|
2.335
|
2.504
|
2.130
|
2.737
|
3.618
|
|
(0.245)
|
(0.292)
|
(0.203)
|
(0.193)
|
(0.245)
|
(0.179)
|
(0.066)
|
|
rest
|
4.950
|
4.365
|
4.982
|
5.787
|
7.391
|
9.592
|
7.653
|
|
(0.024)
|
(0.033)
|
(0.028)
|
(0.028)
|
(0.009)
|
(0.005)
|
(0.009)
|
|
misc
|
1.963
|
0.501
|
0.695
|
0.594
|
1.495
|
1.238
|
1.218
|
|
(0.028)
|
(0.604)
|
(0.462)
|
(0.495)
|
(0.127)
|
(0.212)
|
(0.212)
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. Source: Author’s calculation.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
meat
|
-1.283
|
-2.973
|
-0.734
|
2.335
|
0.091
|
0.432
|
-1.780
|
|
(0.521)
|
(0.178)
|
(0.770)
|
(0.362)
|
(0.986)
|
(0.915)
|
(0.484)
|
|
fish
|
-1.923
|
-3.275
|
-4.825
|
-5.100
|
-1.459
|
1.442
|
-0.095
|
|
(0.404)
|
(0.146)
|
(0.070)
|
(0.047)
|
(0.535)
|
(0.559)
|
(0.972)
|
|
milk
|
-2.491
|
-1.951
|
0.767
|
0.471
|
4.049
|
4.818
|
1.808
|
|
(0.352)
|
(0.507)
|
(0.803)
|
(0.854)
|
(0.164)
|
(0.117)
|
(0.432)
|
|
fruit
|
-4.303
|
-3.349
|
1.101
|
2.744
|
3.368
|
4.127
|
2.787
|
|
(0.277)
|
(0.380)
|
(0.779)
|
(0.455)
|
(0.366)
|
(0.296)
|
(0.455)
|
|
veg
|
-8.104
|
-4.751
|
2.806
|
3.644
|
4.121
|
7.153
|
7.649
|
|
(0.136)
|
(0.357)
|
(0.601)
|
(0.446)
|
(0.408)
|
(0.178)
|
(0.141)
|
|
coffee
|
-1.677
|
-1.464
|
-2.774
|
2.215
|
6.952
|
5.684
|
4.821
|
|
(0.371)
|
(0.441)
|
(0.211)
|
(0.329)
|
(0.014)
|
(0.014)
|
(0.023)
|
|
juice
|
0.157
|
-1.986
|
-0.516
|
-1.538
|
1.077
|
2.895
|
2.394
|
|
(0.901)
|
(0.441)
|
(0.831)
|
(0.592)
|
(0.685)
|
(0.244)
|
(0.300)
|
|
wine
|
-0.528
|
-0.290
|
0.727
|
2.099
|
5.995
|
3.565
|
5.966
|
|
(0.770)
|
(0.869)
|
(0.709)
|
(0.329)
|
(0.005)
|
(0.080)
|
(0.005)
|
|
beer
|
3.788
|
3.975
|
-0.751
|
-1.279
|
-0.452
|
0.967
|
3.097
|
|
(0.047)
|
(0.052)
|
(0.718)
|
(0.521)
|
(0.812)
|
(0.568)
|
(0.080)
|
|
tobacco
|
-0.927
|
-1.655
|
-2.002
|
-2.913
|
-2.302
|
-1.474
|
-3.132
|
|
(0.765)
|
(0.545)
|
(0.502)
|
(0.357)
|
(0.446)
|
(0.592)
|
(0.347)
|
|
cloth
|
8.285
|
6.095
|
3.391
|
3.044
|
1.403
|
3.844
|
6.031
|
|
(0.005)
|
(0.028)
|
(0.239)
|
(0.291)
|
(0.610)
|
(0.192)
|
(0.028)
|
|
foot
|
7.504
|
3.174
|
1.657
|
1.126
|
2.055
|
2.582
|
7.947
|
|
(0.014)
|
(0.310)
|
(0.582)
|
(0.681)
|
(0.512)
|
(0.385)
|
(0.009)
|
|
cater
|
4.486
|
3.314
|
3.236
|
4.180
|
4.397
|
5.376
|
5.883
|
|
(0.005)
|
(0.014)
|
(0.014)
|
(0.009)
|
(0.005)
|
(0.005)
|
(0.005)
|
|
rest_caf
|
5.289
|
3.131
|
3.325
|
4.224
|
4.380
|
5.399
|
5.818
|
|
(0.005)
|
(0.014)
|
(0.014)
|
(0.005)
|
(0.005)
|
(0.005)
|
(0.005)
|
|
accomm
|
2.670
|
4.605
|
4.833
|
-0.029
|
6.069
|
13.572
|
8.008
|
|
(0.399)
|
(0.150)
|
(0.131)
|
(0.977)
|
(0.066)
|
(0.014)
|
(0.033)
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. Source: Author’s’calculation.
Source: Author’s calculation.
Note: y-o-y annual HICP inflation rates are depicted on the horizontal axis, and measures of market concentration are on the vertical axis. Both panels refer to the period of 2006-2021, conditioned by data availability. Source: Author’s calculation based on data from the Agency for the Protection of Market Competition.
 Note: Vertical axis captures the gaps between actual and synthetic values of corresponding variables (in percentage points). Positive gaps imply that actual values are greater than the synthetic ones, i.e. the currency changeover induced an inflation hike. Horizontal axis denotes time. Vertical dashed line denotes the date of currency changeover (January 2023). Grey shaded area after the currency changeover corresponds to the 95% confidence interval. Hicp and health models are estimated without auxiliary covariates. Food model is estimated with exp, gap, hicp, beer, fish, and milk as covariates. Nonalc, clothing, and housing models use exp, gap, and hicp as covariates. Furn and commun utilize fuel, exp, gap, and hicp; while recr, educ, rest, misc, and alc use fuel, exp, and gap as covariates. For the transport model we used exp and gap. Source: Author’s calculation.
Note: Vertical axis captures the gaps between actual and synthetic values of corresponding variables (in percentage points). Positive gaps imply that actual values are greater than the synthetic ones, i.e. the currency changeover induced an inflation hike. Horizontal axis denotes time. Vertical dashed line denotes the date of currency changeover (January 2023). Grey shaded area after the currency changeover corresponds to the 95% confidence interval. Meat, fish, fruit, veg, foot, rest_solo, and accomm models are estimated without auxiliary covariates. Wine and cloth models use exp, gap, and hicp as covariates. Milk, juice, beer, tobacco, and cater utilize fuel, exp, gap, and hicp as covariates. For the coffee model we used exp and gap. Source: Author’s calculation.  Note: Vertical axis captures the gaps between actual and synthetic values of corresponding variables (in percentage points). Positive gaps imply that actual values are greater than the synthetic ones, i.e. the currency changeover induced an inflation hike. Horizontal axis denotes time. Vertical dashed line denotes the date of currency changeover (January 2023). Grey shaded area after the currency changeover corresponds to the 95% confidence interval. Meat, fish, fruit, veg, foot, rest_solo, and accomm models are estimated without auxiliary covariates. Wine and cloth models use exp, gap, and hicp as covariates. Milk, juice, beer, tobacco, and cater utilize fuel, exp, gap, and hicp as covariates. For the coffee model we used exp and gap. Source: Author’s calculation.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
hicp
|
1.048
|
0.434
|
0.847
|
0.000
|
0.702
|
1.652
|
1.823
|
|
(0.089)
|
(0.174)
|
(0.352)
|
(0.826)
|
(0.568)
|
(0.023)
|
(0.014)
|
|
food
|
-0.522
|
-0.716
|
-0.232
|
1.993
|
3.079
|
3.914
|
2.744
|
|
(0.413)
|
(0.423)
|
(0.793)
|
(0.775)
|
(0.460)
|
(0.249)
|
(0.709)
|
|
nonalc
|
-0.507
|
-2.834
|
-2.613
|
-1.084
|
1.189
|
2.076
|
2.150
|
|
(0.765)
|
(0.197)
|
(0.202)
|
(0.634)
|
(0.427)
|
(0.122)
|
(0.113)
|
|
alc
|
1.436
|
0.294
|
-1.040
|
-0.518
|
-0.103
|
0.553
|
0.109
|
|
(0.432)
|
(0.822)
|
(0.305)
|
(0.441)
|
(0.577)
|
(0.690)
|
(0.690)
|
|
clothing
|
6.406
|
4.039
|
1.820
|
1.070
|
0.093
|
1.796
|
4.496
|
|
(0.005)
|
(0.023)
|
(0.263)
|
(0.305)
|
(0.498)
|
(0.192)
|
(0.005)
|
|
housing
|
0.391
|
-0.587
|
-1.036
|
-5.251
|
-5.417
|
-4.636
|
-3.567
|
|
(0.117)
|
(0.146)
|
(0.362)
|
(0.789)
|
(0.704)
|
(0.606)
|
(0.573)
|
|
furn
|
1.784
|
1.233
|
0.046
|
-1.423
|
0.143
|
0.882
|
1.607
|
|
(0.028)
|
(0.174)
|
(0.521)
|
(0.324)
|
(0.615)
|
(0.282)
|
(0.033)
|
|
health
|
2.026
|
1.316
|
0.594
|
0.278
|
1.040
|
2.156
|
2.361
|
|
(0.502)
|
(0.728)
|
(0.728)
|
(0.573)
|
(0.329)
|
(0.197)
|
(0.192)
|
|
transport
|
-1.009
|
-0.596
|
-0.339
|
-1.726
|
-1.209
|
0.655
|
1.183
|
|
(0.761)
|
(0.488)
|
(0.840)
|
(0.596)
|
(0.643)
|
(0.488)
|
(0.315)
|
|
commun
|
0.368
|
-0.245
|
0.629
|
1.562
|
0.928
|
-0.252
|
1.924
|
|
(0.516)
|
(0.526)
|
(0.667)
|
(0.887)
|
(0.991)
|
(0.526)
|
(0.380)
|
|
recr
|
0.700
|
-0.570
|
-2.035
|
-2.597
|
-2.989
|
-2.664
|
-0.735
|
|
(0.967)
|
(0.338)
|
(0.146)
|
(0.056)
|
(0.047)
|
(0.033)
|
(0.085)
|
|
educ
|
0.353
|
-24.000
|
0.186
|
0.011
|
-0.190
|
0.395
|
1.052
|
|
(0.981)
|
(0.873)
|
(0.808)
|
(0.704)
|
(0.624)
|
(0.761)
|
(0.958)
|
|
rest
|
3.341
|
2.776
|
2.863
|
3.088
|
4.725
|
7.510
|
5.811
|
|
(0.028)
|
(0.033)
|
(0.028)
|
(0.042)
|
(0.014)
|
(0.005)
|
(0.005)
|
|
misc
|
1.042
|
-0.355
|
-0.237
|
-0.418
|
-0.380
|
-0.318
|
0.014
|
|
(0.028)
|
(0.695)
|
(0.376)
|
(0.254)
|
(0.164)
|
(0.047)
|
(0.038)
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. Source: Author’s calculation.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
hicp
|
2.130
|
1.686
|
1.660
|
0.683
|
1.086
|
2.256
|
2.379
|
|
(0.089)
|
(0.174)
|
(0.352)
|
(0.826)
|
(0.568)
|
(0.023)
|
(0.014)
|
|
food
|
1.317
|
1.103
|
1.866
|
2.682
|
3.121
|
3.462
|
1.893
|
|
(0.413)
|
(0.423)
|
(0.793)
|
(0.775)
|
(0.46)
|
(0.249)
|
(0.709)
|
|
nonalc
|
1.229
|
-1.142
|
2.255
|
-0.191
|
1.816
|
2.812
|
1.673
|
|
(0.765)
|
(0.197)
|
(0.202)
|
(0.634)
|
(0.427)
|
(0.122)
|
(0.113)
|
|
alc
|
0.253
|
-1.483
|
-3.047
|
-2.157
|
-2.005
|
-1.661
|
-1.648
|
|
(0.432)
|
(0.822)
|
(0.305)
|
(0.441)
|
(0.577)
|
(0.69)
|
(0.69)
|
|
clothing
|
6.200
|
4.550
|
0.759
|
1.946
|
0.806
|
3.057
|
6.611
|
|
(0.005)
|
(0.023)
|
(0.263)
|
(0.305)
|
(0.498)
|
(0.192)
|
(0.005)
|
|
housing
|
6.506
|
5.691
|
2.228
|
0.138
|
0.341
|
0.600
|
-0.541
|
|
(0.117)
|
(0.146)
|
(0.362)
|
(0.789)
|
(0.704)
|
(0.606)
|
(0.573)
|
|
furn
|
-3.466
|
-3.012
|
-3.861
|
-4.883
|
-3.060
|
-1.630
|
-0.530
|
|
(0.028)
|
(0.174)
|
(0.521)
|
(0.324)
|
(0.615)
|
(0.282)
|
(0.033)
|
|
health
|
1.483
|
0.804
|
1.072
|
1.593
|
0.537
|
3.578
|
3.578
|
|
(0.502)
|
(0.728)
|
(0.728)
|
(0.573)
|
(0.329)
|
(0.197)
|
(0.192)
|
|
transport
|
1.844
|
1.932
|
-0.292
|
-1.231
|
-1.572
|
0.027
|
1.589
|
|
(0.761)
|
(0.488)
|
(0.84)
|
(0.596)
|
(0.643)
|
(0.488)
|
(0.315)
|
|
commun
|
-2.172
|
-1.698
|
-0.956
|
-0.133
|
-0.398
|
-1.550
|
1.175
|
|
(0.516)
|
(0.526)
|
(0.667)
|
(0.887)
|
(0.991)
|
(0.526)
|
(0.38)
|
|
recr
|
-3.983
|
-5.523
|
-7.025
|
-7.190
|
-6.930
|
-6.538
|
-4.478
|
|
(0.967)
|
(0.338)
|
(0.146)
|
(0.056)
|
(0.047)
|
(0.033)
|
(0.085)
|
|
educ
|
6.853
|
6.611
|
6.372
|
5.934
|
5.669
|
5.962
|
6.387
|
|
(0.981)
|
(0.873)
|
(0.808)
|
(0.704)
|
(0.624)
|
(0.761)
|
(0.958)
|
|
rest
|
2.290
|
1.822
|
2.142
|
2.303
|
4.345
|
7.273
|
5.867
|
|
(0.028)
|
(0.033)
|
(0.028)
|
(0.042)
|
(0.014)
|
(0.005)
|
(0.005)
|
|
misc
|
-1.425
|
-2.578
|
-2.593
|
-2.417
|
-2.143
|
-1.117
|
-0.310
|
|
(0.028)
|
(0.695)
|
(0.376)
|
(0.254)
|
(0.164)
|
(0.047)
|
(0.038)
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. Source: Author’s calculation.
|
January
|
February
|
March
|
April
|
May
|
June
|
July
|
|
hicp
|
0.851
|
0.634
|
1.218
|
-0.527
|
-0.425
|
0.459
|
0.948
|
|
food
|
-2.481
|
-1.535
|
-0.590
|
0.548
|
1.102
|
1.167
|
0.343
|
|
nonalc
|
0.218
|
-1.857
|
-1.481
|
-0.360
|
1.590
|
1.664
|
2.326
|
|
alc
|
2.164
|
-0.168
|
-1.283
|
-1.377
|
0.283
|
1.941
|
1.028
|
|
clothing
|
7.069
|
4.907
|
3.035
|
4.122
|
2.867
|
3.736
|
7.044
|
|
housing
|
-6.476
|
-4.073
|
-3.834
|
-9.746
|
-11.619
|
-10.590
|
-8.810
|
|
furnish
|
4.001
|
2.770
|
2.731
|
0.847
|
1.593
|
1.723
|
2.154
|
|
health
|
-0.227
|
-0.686
|
-0.945
|
-1.839
|
-0.615
|
-0.386
|
-0.062
|
|
transport
|
-1.400
|
-1.975
|
-1.969
|
-2.962
|
-4.194
|
-2.425
|
-0.019
|
|
commun
|
-2.808
|
-3.525
|
-3.162
|
-1.544
|
-0.892
|
-1.316
|
0.756
|
|
recr
|
3.000
|
1.630
|
0.586
|
-1.504
|
-1.260
|
-1.679
|
-2.002
|
|
educ
|
-5.692
|
-6.128
|
-6.146
|
-5.223
|
-5.587
|
-5.525
|
-5.425
|
|
rest
|
4.238
|
3.424
|
2.932
|
0.292
|
3.928
|
6.773
|
4.584
|
|
misc
|
2.999
|
1.364
|
2.649
|
3.161
|
3.476
|
2.990
|
3.050
|
Note: Table entries are gaps between actual and synthetic values of corresponding variables. Positive gaps imply that actual values are greater than the synthetic ones. P-values are given in parentheses. Bold entries are significant at the 5% level. Source: Author’s calculation.
Figure 1HICP inflation (year-on-year) rates and inflation expectations in Croatia DISPLAY Figure
Table 1ASCM baseline estimations (January to July 2023) DISPLAY Table
Figure 2Average ASCM country weights DISPLAY Figure
Table 2ASCM placebo specifications across countries (January to July 2023) DISPLAY Table
Table 3ASCM results (January to July 2023): placebo estimations across time (2015M05 as intervention date) DISPLAY Table
Table 4ASCM results (January to July 2023): placebo estimations across time (2022M09 as intervention date) DISPLAY Table
Table 5ASCM results (January to July 2023): placebo estimations across time (2022M12 as intervention date) DISPLAY Table
Table 6ASCM estimations for lower-level ECOICOP inflation categories (January to July 2023) DISPLAY Table
Figure 3Price increases attributable to the euro changeover DISPLAY Figure
Figure 4Market concentration and inflation in Croatia DISPLAY Figure
Figure A1ASCM baseline estimations DISPLAY Figure
Figure A2ASCM estimations for lower-level ECOICOP inflation categories DISPLAY Figure
Table A1ASCM robustness check via matrix completion method (January to July 2023) DISPLAY Table
Table A2ASCM robustness check via generalized synthetic control (January to July 2023) DISPLAY Table
Table A3ASCM robustness check via the Becker and Klößner (2018) method (January to July 2023) DISPLAY Table
* The author thanks the editor, Katarina Ott, and two anonymous reviewers for very useful and exceptionally meticulous comments that have considerably improved the quality of the paper. Any remaining errors are, of course, my own. The author also wants to thank Davor Jakelić (Agency for the Protection of Market Competition) and Jasminka Pecotić Kaufman for help with gathering retail market concentration data. The article was judged the best regular article in the 2023 annual competition of the Prof. Dr. Marijan Hanžeković Trust.
1 Ideally, one would use oil prices on the global market as an exogenous inflation determinant (e.g. Wen, Zhang and Gong,  2021; Li and Guo, 2022), but SCM requires input data that vary across entities. As national HICP electricity, gas, and other fuels prices are closely positively correlated to the global market oil prices, we made an empirical compromise and continued the analysis with the former variable. In a similar vein, industrial production is used for the calculation of output gaps instead of GDP to ensure monthly frequencies of data.
2 We also considered the following placebo intervention dates: 2002M06, 2022M10, 2022M11, along with 2020M07 when Croatia entered the ERM2 mechanism and 2014M05 when the ECB released its first convergence report for Croatia (and declared that Croatia satisfies the Maastricht criterion of inflation stability). The results are qualitatively very similar to those reported in tables 3-5.
|
|
March, 2024
I/2024
|
